City Manager Talks Building 'A Consortium Of Communities' To Advocate For New Tourism Tax

A year after a citizen-led petition ignited conversations about a new type of visitor lodging tax in Traverse City, City Manager Benjamin Marentette is taking up the cause in a big way. Marentette recently told city commissioners he was putting together a statewide coalition to lobby legislators for a tourist tax that could help fund public safety services, infrastructure improvements, and more. The Ticker sat down with Marentette for an inside look at his efforts so far.

Ticker: How long has this idea been percolating in your brain?

Marentette: I've worked for the city for over two decades, and I've been thinking about this concept for at least the last 15 years. [An accommodation tax] has always seemed like an important step for bringing some equity to city residents. We have extra need for city services and city infrastructure – and more burdens on the people who live here – because, while we're a relatively small city, we also have about 6 million visitors a year. There are times where the city has a few hundred thousand people within its limits at one time.

We eventually need to start having some conversations around what is the right service level, even from a public safety standpoint, around these huge population surges. Are we staffed for that? Are we prepared for that? Because Traverse City is only getting more and more and more popular. Just look at all the different direct flights we now have out of our local airport.

Ticker: What finally prompted action?

Marentette: I'm sure you know that the city now has a strategic action plan, and that strategic plan was based upon robust public input. We had about 1,500 residents provide input, and we're fortunate that there were a number of areas of alignment there, which ultimately formed the key pillars of the strategic plan. One of the key pillars is sustainable tourism.

When the strategic plan was unanimously adopted by the city commission in June 2025, we developed OKRs (objectives and key results), and one of the key elements of that OKR work plan, under the pillar of sustainable tourism, was to explore the idea of an accommodation tax. The thinking here is to recognize that we have significant infrastructure and city service demands because we're not just a year-round resident community; we are a destination community.

Ticker: How do you see an accommodation tax helping create more sustainable tourism in northern Michigan?

Marentette: What I shared recently at a city commission meeting is that we have some substantial fiscal needs coming up over the next few years. For example, just to effectively steward and extend the useful life of our roads, so we aren’t paying 4-5 times as much in a few years to do a total reconstruction, we need to do [maintenance]. And basically, nurturing what we have is about $45 million need over the next few years.

The City of Traverse City is also an employer: We have $30 million in payroll and wages, and the rising cost of living and the need to pay more to stay competitive is a real force that we're dealing with. Additionally, over the next 2-3 years, a third of our workforce is eligible for retirement, so we also have to think about how we are going to recruit people into all of the service areas that the city provides in a competitive way.

Finally, we have substantial facilities needs. We've had not had a facilities management strategy, or even a person who is a facilities manager, until a year ago. We're now doing multi-year facilities budget forecasting for the first time.

So, there's all these forces, and we’re asking: How can we help stabilize taxes for local residents, as we deal with these fiscal needs? That led to an accommodation tax.

Ticker: How would the tax work?

Marentette: We are so much in the initial stages that I don't want to suggest we've got this idea thoroughly baked. I think there needs to be a lot of conversation with various communities about what's going to work, what's needed, what is passable as legislation, etc. I've got some ideas in my head about how the money could be used, but that is not locked in, at all.

I will say that an accommodation tax would apply not just to hotels, but also short-term rentals. And this is a user tax, so it's not a tax on the businesses. It’s an extra tax on the customer that's coming into the community and creating the need for more services and creating more wear and tear on infrastructure.

Ticker: What are the first steps?

Marentette: I'm working to build a consortium of communities across the state of Michigan to leverage our collective heft. We’re going to put our heads together to talk about how can we help bring equity to the tourism ecosystem. The idea is to have a very focused, intentional discussion that's strategic and holistic around the ecosystem and what changes we might want to collectively advocate for. And we’re talking legislative changes here, because an accommodation tax would require an act of the legislature in Michigan. We have state laws right now that don't allow cities like Traverse City– or most local governments in the state, other than Detroit and Grand Rapids – to levy any sort of accommodation tax.

Ticker: From those early conversations, how confident are you that that this is possible? There was already a legislative push for a visitor tax last year, but it didn’t go anywhere…

Marentette: I want to acknowledge that this is a long road. This is not something that's going to happen in a year. I’d guess we’re looking at a 2-3-year conversation before we, potentially, have some movement. But I am sensing a strong appetite to have this conversation across the state of Michigan. And I like that, because frankly, to make change requires more than just Traverse City advocating with the legislature. It needs to be a collective effort with a bunch of communities across the state, so we can leverage the voting power of the legislators in Michigan, which are way more concentrated in the Grand Rapids and southeast Michigan than they are here.

Ticker: Will the tourism industry be involved in these discussions?

Marentette: We’re definitely working with industry, including those in the accommodation space. Mayor Amy Shamroe and I had an initial meeting last week with Trevor Tkach from Traverse City Tourism and some folks from the hospitality industry, and I thought it was a really valuable conversation. They certainly have some concerns. I think it's clear we need to put our heads together more. We're not going to agree on everything. We definitely have some different interests, but we also have some collective interests. I think we all acknowledge that tourism does a lot of great things for communities, including our own. But it also comes with certain costs. So, we’re just trying to find the right balance.

Ticker: What now?

Marentette: Traverse City is hosting the Michigan Municipal League annual conference in October, and the mayor and I, along with Mayor Pro Tem Laura Ness, intend to convene as many interested communities at that conference as possible. We think that would be a great place to facilitate alignment across different communities and start developing a strategy to provide more equity in this whole situation.